The SEA boss warns of China’s maritime ambitions

Among future challenges facing the European shipping industry, few are as daunting as the emergence of China as a commercial maritime power.
“China is basically targeting Europe and Europe’s global maritime leadership,” says Christophe Tytgat, Secretary General of SEA Europe, which represents the continent’s shipyards and maritime equipment manufacturers.

Tytgat, who has headed the organization since 2016, cites the country’s Made In China 2025 initiative, issued by former Chinese Premier Li Keqiang and his cabinet three years ago to increase the Asian manufacturing power’s global reach in a number of industries.

“China wants to have the leadership position in ten strategic sectors, two of which are ours – complex shipbuilding, like cruise ships, and complex marine equipment manufacturing,” Tytgat said. “They are trying to buy ports in Europe to export more Chinese manufactured goods, a one-dock, one-world strategy that has one aim, to export more Chinese goods throughout the world.”

For the European shipping industry, Tytgat says the threat is apparent from a global giant with government backing, an advantage the European maritime industry does not have.

“There is a clear target that big Chinese shipping conglomerates want to take over the European maritime leadership,” Tytgat said. “It’s not just a commercial thing. It’s a big challenge because it is also a geopolitical and a geostrategic thing. These companies are doing it not because their CEOs necessarily want to do it, but because the government tells them to do it.

“They have all the backing from the government, including state aid and financial incentives, which companies in Europe don’t have. So you’re competing on unequal footing.”

Tytgat made his comments in an interview in early December in Helsinki during Breaking Waves 2018, an industry platform designed to increase the competitiveness of the European Maritime Cluster. As a part Slush 2018, the world’s largest start-up convention, Breaking Waves brought together top leaders, maritime experts and start-up companies as a means to improve communication and cooperation across all European maritime platforms.

The seminar included a think tank to address the industry’s challenges, including China, environmental goals and attracting younger talent to the field.

“In my opinion the think tank served a big advantage in that it brought everyone together,” Tytgat said. “We all agreed across the board on the same challenges and opportunities. We aren’t even disputing the arguments of the others. So basically we have a common vision.

“That’s not to say we all agree on the solutions. At the end of the day that’s where the challenge lies. But having all the segments agree on the topics is a big thing. It’s good that we all agree these are the same battles.”

Tytgat, who has a law degree and began his career in 1999 as a civil servant in the Belgian federal administration, has worked for the past 17 years for the European Community Shipowners’ Association (ECSA). He has served as the ECSA’s senior director for competition, legal, taxation and social affairs. As such, he also sees the need to change what he perceives as the European maritime cluster’s image problem.

“Who knows shipping, apart from a polluting industry? You take a bus, a plane or a train,” he said. “Who takes a ship? In except for a few instances, ships are no longer coming into the center of the cities. In Antwerp and Rotterdam, the ships are far away from the city centers. People are no longer as used to the ships as they were before.

“Except if you take a cruise ship. Then you have the other debate – tourists vs. the local inhabitants. This is the trouble we have in terms of image.”

He also described the public perception of the maritime industry as the “three Ds” – dirty, difficult and dangerous.

“People think of us in terms of it’s dangerous, it’s difficult and it’s dirty, but it’s not,” he said. “People think it’s (government) subsidized, but it’s not. We fail to tell the good story.”

The good news, he said, is that European shipping is moving closer to its future goal of zero carbon emissions.

“In Europe we the have technology providers that can help reduce emissions,” he said. “A lot of people don’t know that. Are we at a point of zero emissions? No. But we are adjusting. Nine percent of sales go back into research and development for emissions. We want to make sure that shipping is zero carbon emissions.

“Will we get there today? No, we have to further invest. That’s why we need the European commission, so we can do these investments. We are willing to do it.”

Tytgat said it is also encouraging that young talent is becoming interested in the shipping industry.

“There were many smart people walking around Slush,” he said. “These youngsters will come in. We need fresh blood. Will they come in with the new technology? Hopefully, to a large extent, they will. All these initiatives we need to evolve, from digitalization, to atonamous shipping, to the environment. I’m quite confident we will get there.”

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